HC Deb 19 March 1990 vol 169 cc871-2
3. Mr. Martyn Jones

To asks the Secretary of State for Wales what representations he has had from business organisations in Wales about the level of interest rates.

The Secretary of State for Wales (Mr. Peter Walker)

None directly, but reference to the level of interest rates has been made by a few organisations in discussions with the Department.

Mr. Jones

I thank the Secretary of State for that reply. I am rather surprised that he has not received more representations from businesses. As chambers of commerce and trade were consulted about the poll tax, which really has no direct bearing on them, will they and the Confederation of British Industry also be consulted about interest rates in Wales?

Mr. Walker

We consult the Confederation of British Industry and the chambers of trade and commerce on all issues and I am glad to say that all the recent surveys of the Confederation of British Industry and the chambers of commerce and trade show them to be most optimistic about the future of the Welsh economy.

Mr. Ian Bruce

Does my hon. Friend agree that business profitability is now so good under the Conservative Government that businesses are still able to increase their investments despite high interest rates? Although we shall be looking for interest rates to come down as quickly as possible, it is clear that the return to investors and to pensioners who have invested their savings will be extremely good.

Mr. Walker

Yes. Welsh industrialists look back upon the period which started in October 1976 when interest rates were 15 per cent., inflation and taxation were massively higher than they are today, and Welsh Development Agency programmes were not on par with what they are today.

Mr. Barry Jones

Is the right hon. Gentleman concerned at the impact of high interest rates on domestic budgets and the numerous small businesses that he has so patiently encouraged? May I remind him that the Policy Studies Institute estimates that 120,000 Welsh households are in serious debt, that perhaps 750,000 have some debt and that indebtedness is growing rapidly throughout Wales? Is not Wales paying a heavy price for the Prime Minister's and the Cabinet's mistakes? I notice that the right hon. Gentleman has distanced himself from the Government's policies.

Mr. Walker

I only wish that the hon. Gentleman had distanced himself from his Government's policies when he was Under-Secretary of State. During his few years with the Welsh Office, unemployment went up, during mine it has gone down by 68,000; in his period of office there was a very small flow of inward investment, whereas in mine it has been massive; under the hon. Gentleman, inflation rates rose to enormous proportions, there were high interest rates and high taxation. His record for the Welsh economy was dismal and bad.